Surround Your Customers and Clients
Case study: Bill Bonner, master marketer
Oct. 20, 2005: Vol. 1, Issue No. 41
IN THE NEWS
Secrets of the "Untourist" Revealed
Never go where tourists go...
Never sleep where tourists sleep...
Never eat where tourists eat.
--Pop-up Internet Ad
Oct. 16, 2007
In 1979, a fledgling entrepreneur named Bill Bonner was bloodied by three failures and was $70,000 in debt. In his head he conceived a newsletter to be called International Living for people who wanted the good life, but couldn't afford it in the United States. He sat down at a typewriter to write a subscription letter and began to peck away at the keys.
The letter ran a staggering 3,710 words, defying the old shibboleth that people won't read long letters. The offer was for "12 information-packed issues for $34," plus "A FREE copy of "The 5 Best Retirement Destinations in the World."
This sales letter--for a newsletter that did not exist--was cash positive from day one, bringing in 300 percent of breakeven.
This letter launched Agora, Bill Bonner's $100 million publishing empire with 340 employees working out of of six magnificently restored houses in Baltimore (including a Stanford White masterpiece), sumptuous digs in London and a 17th century fixer-upper castle in the Loire Valley in France.
Twenty-five years later, right now, this same letter--slightly updated and currently running 4,032 words--is going gangbusters on the Internet.
What's more, instead of just bringing in subscribers, it's creating streams of revenue from travelers, investors, book buyers and overseas real estate buyers.
Bill Bonner has surrounded his customers.
Many years ago I had a rather fanciful article on direct mail accepted by Folio: The Magazine of Magazine Management. The editor, Charles I. (Chuck) Tannen, invited me to lunch near his offices in New Canaan, Conn.
Tannen was a lovely, gentle man, short, with curly hair, a mustache and thick eyeglasses. The love of his life was flying his little plane, a hobby he was forced to abandon when he was diagnosed with an obscure, though not life-threatening, illness.
Over lunch I asked Chuck if Folio was profitable. He waggled his hand, meaning "comme ci, comme ça," or so-so.
"We have 10,000 subscribers, which gives us subscription and advertising income," he said. "We also publish books, have a card deck, seminars, do consulting and make money on list rentals. And, of course, we have the Folio show, which brings in a lot of revenue. If someone pays us for any of these products or services, it's our license to sell that person everything else we have."
Tannen added, "It is our intention to surround the industry."
Bill Bonner: Creating an Industry and Surrounding It
Sending out an offer for a non-existent product is called a dry test. It's cheaper to test market a product to see if it has legs before going to all the expense of creating the product. Bonner's letter was (and is) a masterpiece. It began:
You look out your window, past your gardener, who is busily pruning the lemon, cherry, and fig trees ... amidst the splendor of gardenias, hibiscus and hollyhocks.
The sky is clear blue. The sea is a deeper blue, sparkling with sunlight.
A gentle breeze comes drifting in from the ocean, clean and refreshing, as your maid brings you breakfast in bed.
For a moment, you think you have died and gone to heaven.
But this paradise is real. And affordable. In fact, it costs only half as much to live this dream lifestyle ... as it would to stay in your own home!
I'd like to send you a FREE copy of a unique--and invaluable--report.
It's called The 5 Best Retirement Destinations in the World. And it tells you about the best places in the world for retirement living.
The letter positively gushed with enthusiasm, excitement, promises, and benefits, benefits, BENEFITS.
Not only did it talk about wonderfully inexpensive retirement havens, but also travel, real estate investments, taxes, currencies and offshore investments.
The letter was also the wiring diagram for the future of a sprawling business that today includes:
Free e-letters and reports - subscription services (International Living, Mexico Insider, Panama Insider) - financial newsletters - health newsletters - The Oxford Club - print issue archive - VIP services - bookstore - country reports - expatriate advice - offshore - taxation - work overseas - seminars and tours - property for sale and rent.
The First Blog
In January 1999, Bonner started writing what was very likely the first blog--an interminably long e-newsletter titled The Daily Reckoning. At first it was something he felt compelled to do from his vantage point in Paris, as well as from his travels. He would get up at 5 a.m. and work for four hours, whereupon he would start his regular workday at 9 a.m.
The blog/letter was filled with news and observations of the day and laced with history, economics, investment advice and personal anecdotes from the life of a mostly expatriate who returned to Baltimore periodically. It included tales of everything from life with a hammer, screwdriver and paint can at his beloved Chateau d'Ouzilly--just down the road from the late David Ogilvy's Chateau Toffou--to commentary on international affairs, and financial projections of major markets and countries.
Eventually, Bonner started mentioning various products, reports, hyperlinks, books, real estate and investment opportunities. Suddenly it was paying for itself in spades.
How Bonner Deals with the 'Can Spam' Law
With servers all over the world and spammers thumbing their noses at any kind of regulation, spam is the bane of world business. I once figured out that dealing with spam could cost two full work weeks every year for the average executive.
Instead of spam, Bonner uses the pop-up. Go to The New York Times Web site (or any number of others), and sometimes a Bonner pop-up will appear on your screen.
The "IN THE NEWS" section above contains Bonner's latest pop-up. Another one:
Learn About The World's Six Best Places To Live Or Retire
Live like royalty on $17 a day.
Own an exotic beachfront getaway for $35,000. Or a romantic pied-a-terre for under $60,000. Enjoy fine restaurant dining for $7 per person. Employ your own maid or gardener.
Click here for Details and a Free Report
Click for details, and you'll get the magnificent 25-year-old letter still going strong, still bringing in business.
Takeaway Points to Consider
- Old direct marketing rule of thumb: It's five times more expensive to acquire a new customer than to sell to an existing customer.
- Never forget that the Internet is essentially a print medium, and that long copy works, but only if compellingly written.
- How can you surround your customers or clients? What new products, services or line extensions can you come up with that will bring in additional revenue and cut out your competitors?
- Need ideas for new products or services? Go to your existing customer base and use surveys or focus groups or both.
- If you go the focus group route, you will very likely be better off hiring professionals who specialize in this form of market research. The information and data they can elicit are more accurate and actionable than that acquired by bumbling amateurs who are likely to load the questions to fit their agenda.
- Go back through your old promotional efforts, find those that were successful, update them, and test them. Chances are they may work again.
- Remember Henny Youngman's line: There are no old jokes, just old audiences.
Web Sites Related to Today's Edition
Bill Bonner's World
International Living Pop-up
Secrets of the "Untourist"
The Daily Reckoning